Hot trading in F J Benjamin shares prompts SGX query

In an SGX filing on Jan 4, the bourse cited "unusual volume movements" in F J Benjamin's shares.
In an SGX filing on Jan 4, the bourse cited "unusual volume movements" in F J Benjamin's shares.ST PHOTO: DESMOND WEE

SINGAPORE - Fashion retailer F J Benjamin Holdings has received yet another query from the Singapore Exchange (SGX) following a spike in its trading volume.

As at 11.52am on Thursday (Jan 4) before the midday break, the counter was trading 6.1 per cent, or 0.5 Singapore cent higher to 8.7 cents apiece. Some 39.6 million shares changed hands.

In an SGX filing on Thursday, the bourse cited " unusual volume movements" in the company's shares. Among other things, it asked the firm to disclose information not previously announced concerning the group which explain the trading. These include negotiations that may lead to joint ventures, mergers or acquisitions, as well as the sale or purchase of a significant asset, the SGX said.

This is the second query issued to the company over the past two months. On Nov 22, FJ Benjamin opened at 7.8 cents, jumping 2.5 cents, or an eyebrow-raising 36.2 per cent, to close at 9.4 cents.

The company said in response to SGX's previous query that it was not aware of any possible explanation, besides a proposed renounceable non-underwritten rights cum warrants issue.

In October, FJ Benjamin announced a proposed renounceable non-underwritten rights cum warrants issue to raise up to S$39 million in gross proceeds. About S$12 million will be raised through the issuance of 341 million new ordinary shares at an issue price of 3.5 cents apiece, based on three rights shares for every five existing shares.

In addition, about 682 million warrants will be offered at four cents per warrant, based on two warrants for every one rights share subscribed, which will raise about S$27 million. The warrants have a three-year exercise period.

Assuming that all the warrants are exercised, FJ Benjamin will have about S$35 million in net proceeds, of which about 50 per cent will be used to support the expansion of the group's business activities, and the other half for "general corporate purposes".

For fiscal 2018's first quarter ended Sept 30, 2017, the company narrowed its net loss to S$942,000, from a net loss of S$3.6 million for the year-ago period. Revenue also fell 19 per cent to S$41.4 million for the first quarter as loss-making brands were discontinued.

The company has been on SGX's watch list since December 2016 for sustaining pre-tax losses for more than three consecutive financial years, and having a market cap of less than S$40 million.